Emilia Inc Issued $200,000, 6%, 10-Year Bonds, with Interest Payable

Emilia Inc issued $200,000, 6%, 10-year bonds, with interest payable semiannually. The market rate on the issue date was 5.5%. Emilia received $206,948 in proceeds. Which statement best describes Emilia' responsibility to the bondholders?

A) Emilia must pay $206,948 at maturity.
B) Emilia must pay $200,000 at maturity.
C) Emilia must pay $200,000 at maturity plus 20 interest payments of $6,000.
D) Emilia must pay $200,000 at maturity plus 10 interest payments of $12,000.
E) Emilia must pay $206,948 at maturity plus 20 interest payments of $6,000.

Correct Answer:

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